The Walt Disney Company reported fiscal third-quarter earnings in addition to also revenue in which missed analysts’ expectations on Tuesday.
Here’s how the company did compared with what Wall Street expected:
- Earnings: $1.87 per share vs. $1.95 per share forecast by Thomson Reuters
- Revenue: $15.23 billion vs. $15.34 billion forecast by Thomson Reuters
within the year-ago quarter, Disney reported adjusted earnings of $1.58 per share on revenue of $14.24 billion.
Shares of Disney initially slipped 2 percent in after-hours trade. The stock was last seen edging slightly above its closing cost.
Despite the top in addition to also bottom line miss, the entertainment giant saw strong growth in its studio, parks in addition to also broadcast units.
Disney said its studio revenue grew 20 percent year over year to $2.88 billion, driven by the strong box office performances of Marvel’s “Avengers: Infinity War” in addition to also Pixar’s “Incredibles 2.”
Both movies quickly crossed the $1 billion mark within the global box office. “Avengers: Infinity War” — which had the biggest opening weekend of all time both domestically in addition to also overseas — crossed in which milestone in just 11 days. in which pace is usually faster than any additional movie in history.
Here’s what each business unit reported in revenue compared with what analysts expected, according to StreetAccount consensus estimates:
- Media in addition to also networks: $6.16 billion vs. $6.10 billion forecast by StreetAccount
- Parks in addition to also resorts: $5.19 billion vs. $5.28 billion forecast by StreetAccount
- Studio: $2.88 billion vs. $2.89 billion forecast by StreetAccount
- Consumer in addition to also interactive: $1.00 billion vs. $1.11 billion forecast by StreetAccount
While the parks business posted a 6 percent year-over-year increase in revenue, the segment saw operating income surge 15 percent year-over-year to $1.34 billion. Disney said the the surge in operating income was driven by higher guest spending amid higher average ticket prices in addition to also room rates as well as increases in food, beverage in addition to also merchandise spending.
Disney’s broadcasting business saw a stunning 43 percent year-over-year growth in operating income to $361 million amid higher program sales, affiliate revenue growth in addition to also network advertising revenue. The company said higher sales of “Designated Survivor, “How to Get Away with Murder” in addition to also “Grey’s Anatomy” helped drive in which increase.
In April, Disney launched ESPN Plus, a sports-focused streaming service. While the service is usually still in its early days, CEO Bob Iger said in a Tuesday earnings call in which the service is usually already seeing “strong” conversion rates via free trials to paid subscriptions. The longtime CEO said in which the subscription growth is usually exceeding the company’s expectations, however did not provide specific numbers for in which metric.
Disney’s third-quarter earnings come as the entertainment giant is usually within the process of acquiring major parts of Twenty-First Century Fox.
In July, shareholders of both companies approved the $71.3 billion cash in addition to also stock deal to combine Disney with Fox’s film in addition to also television studios. Disney will also take Fox’s stakes in European pay TV operator Sky, India’s Star in addition to also Hulu.
The deal was approved by U.S. antitrust regulators in late June, on the condition in which Disney might sell Fox’s regional sports networks. Disney still needs to clear regulatory hurdles overseas.
In buying Fox assets, Disney can grow its content library as in which prepares to launch its own streaming service in 2019. CEO Bob Iger told CNBC in December in which the purpose of the deal “is usually to create even more high quality content in addition to also then to distribute in which in ways in which consumers prefer in addition to also consumers demand in today’s world.”
To be sure, the content Disney already owns is usually doing well by many measures. The entertainment giant received 39 Emmy nominations in which year.
Disney shares have gained 6 percent so far in 2018, hitting a 52-week high of $114.68 on July 19.
Fox is usually slated to report earnings after the market close on Wednesday.
Disclosure: Comcast is usually the owner of NBCUniversal, parent company of CNBC in addition to also CNBC.com. Comcast is usually also a co-owner of Hulu.